St. Mary Land & Exploration Company has provided an update on previously announced divestiture activities in the Company's Rocky Mountain region.
Tony Best, CEO and President, commented, "The sale of these non-core properties in the Rocky Mountain region will allow St. Mary to focus its efforts on more compelling growth opportunities both in the region and throughout the Company. The proceeds from these properties and other minor sales, combined with our anticipated cash flows from operations, are expected to fund our 2010 capital budget. These transactions demonstrate our commitment to building a focused portfolio of resource plays from which we can create value for our shareholders."
Rocky Mountain Oil Package
St. Mary has entered into agreements to sell the previously announced package of non-strategic Rocky Mountain oil properties in two separate transactions for a total of $267 million.
The Company entered into an agreement in late December 2009 with Legacy Reserves Operating LP, a wholly-owned subsidiary of Legacy Reserves LP to sell the Wyoming portion of the divestiture package for $130 million. Closing is expected to occur in February 2010. On January 7, 2010, St. Mary entered into an agreement to sell the North Dakota portion of the divestiture package to a private buyer for $137 million. This transaction is anticipated to close in March 2010. Both transactions are subject to customary purchase price adjustments and closing conditions.
Hanging Woman Basin and Miscellaneous Divestitures
On December 18, 2009, St. Mary closed the sale of all operated and non-operated properties in the Hanging Woman Basin coalbed methane project in Wyoming and Montana in a transaction with J.M. Huber Corporation. St. Mary has also recently sold or entered into agreements to sell minor asset packages of other non-strategic properties throughout the Company, the majority of those via auction. Total proceeds from these divestitures are anticipated to be approximately $40 million, subject to customary closing adjustments.
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